Expert doubts closing Dispensaries will Affect Cannabis Prices

Even if the number of dispensaries decrease, the price of cannabis in Vancouver will stay relatively the same, one expert said.

The City of Vancouver announced Monday that 11 of the 176 applications to operate dispensaries in town were approved.

Several more dispensaries are expected to also be approved after a “declustering” process takes place to separate pockets of the businesses.

University of British Columbia PhD student Rielle Capler analyzes how patients access medical cannabis and said there was no price drop when Vancouver saw a large increase in dispensaries in 2013.

Capler said patients currently pay about $8 to $10 for a gram of dried cannabis, the same as before the wave of dispensaries opened, and she expects prices to say the same if many of them are closed.

Capler said many dispensaries are already offering the lowest prices they can, in line with the Health Canada regulated medical cannabis licensed producers.

According to a national survey conducted by Capler looking at how patients accessed the licensed producer system, most patients in Vancouver will continue to seek cannabis out in person, rather than use a licensed producer to mail the product to them.

Even if the majority of dispensaries closed, Capler said patients still want face-to-face interaction and the ability to buy cannabis when they need it.

According to Capler, limiting the number of dispensaries will cause few patients to begin buying off the street, they will just travel further to those dispensaries that remain open.

But Capler said the reduction in locations will hurt low income patients who will need to spend more money to travel.

Cannabis activist David Malmo-Levine said he has no plans to increase prices at his compassion club, Stressed and Depressed, now that the city will be shutting down other dispensaries.  Stressed and Depressed recently passed the city’s first phase of its business licensing process.

“Because we have this decimation of dispensaries, that allows that possibility to exist,” said Malmo-Levine. ”Whereas, if they treated it like coffee beans, there would be no way to price gouge, people would have to compete in quality and price, so the quality would go up and price would go down.”

Sensible BC director Dana Larsen said if the city begins shutting down dispensaries, business owners may start moving into surrounding communities to make money.

“I’m hoping that even though Vancouver might end up only having 50 licensed ones and then trying to shut down the other 70 unlicensed ones in a year from now there’s 500 dispensaries in the Lower Mainland,” Larsen said.